Tax Time - HELP!

Tax Time - HELP!

Post by Cissy . Thorp » Tue, 09 Apr 1996 04:00:00



I usually make about 6 quilts a year - for charity.  This year I need
to take the charitable deduction and need to know what the going price is
for the following:

crib quilts - machine pieced, hand quilted

full size - machine pieced, hand quilted

queen size - machine piced, hand tied.

Any help you can give me is much appreciated.  I did donate one to an
auction this year, and it sold for $215.  It was a queen, quilted by
hand, is that a good going rate?

Cissy

 
 
 

Tax Time - HELP!

Post by Slinsk » Tue, 09 Apr 1996 04:00:00


I had a large lap sized quilt that I donated to an auction go for $450,
and it was machine quilted.

Lisa

 
 
 

Tax Time - HELP!

Post by Jean Lightner Nor » Wed, 10 Apr 1996 04:00:00


"Cissy . Thorpe"  writes:

Quote:
> I usually make about 6 quilts a year - for charity.  This year I need
> to take the charitable deduction and need to know what the going price is

I may be wrong, but I seem to remember reading a couple of
years ago that you were allowed to deduct _only_ the cost of
the materials, that you were not allowed to figure in any value
for your work.  If this is not the case, someone let us all
know.  It's how I've treated the couple of quilts I've donated
to auctions at my sons' school.
--
+-----------------------------------------+
|  Jean Lightner Norum, PhD, MaH*         |

+-----------------------------------------+
 
 
 

Tax Time - HELP!

Post by Cissy . Thorp » Wed, 10 Apr 1996 04:00:00


Quote:

> "Cissy . Thorpe"  writes:
> > I usually make about 6 quilts a year - for charity.  This year I need
> > to take the charitable deduction and need to know what the going price is

> I may be wrong, but I seem to remember reading a couple of
> years ago that you were allowed to deduct _only_ the cost of
> the materials, that you were not allowed to figure in any value
> for your work.  If this is not the case, someone let us all
> know.  It's how I've treated the couple of quilts I've donated
> to auctions at my sons' school.
> --
> +-----------------------------------------+
> |  Jean Lightner Norum, PhD, MaH*         |

> +-----------------------------------------+

Jean -

I think I am reading the instructions right, it says that you can only
deduct the "fair market value" of donations other than cash.  The form
for donations has space for how you determined the value of the items
donated.  The instructions go on to say that if you donated used
clothing, household goods, etc., you should deduct the amount that
you would expect to pay at a thrift shop, used furniture store, etc.

BTW-I got a form 1040-T - apparently a new IRS form that is supposed to
be more machine readable.

Heck, or local Goodwill sells hand quilted full-size quilts for $199!!

Thanks for you help - everyone who responded.

Cissy

 
 
 

Tax Time - HELP!

Post by Nancy Wals » Fri, 12 Apr 1996 04:00:00


I know it's too late for this now - but next time you might want to get an
appraisal done on the quilts.  My insurance guy tells me that in order to
replace anything like a quilt, it need an appraisal to actually state the value,
otherwize it's just pure speculation. (And if I had any quilts in my own home
that were really monetarially worth something, I would do this - but my dogs
seem to keep destroying the one quilt I have.  Boy I hope they stop being
puppies soon! :))

I'm sure that if my insurance company
requires it, the federal government would too.  For this time around,
You'll probably end up having to low-ball it based on how much the materials
cost you.

Good luck - and I hope you don't get audited! (I just mailed off our
return with a big fat check to the IRS this morning - *SOB*)

-Nancy
--

 
 
 

Tax Time - HELP!

Post by Brenda L. Groel » Sun, 14 Apr 1996 04:00:00


Jean,
  As I understand it, the cost of materials applies only if
there is no "fair market value" established for the quilt.
  If you donated it to the auction, then whatever it brought
would be its fair market value and you could use that amount as
a deduction, unless of course, it brought less than your cost
of materials, in which case, you'd use that amount.

  Not an accountant, but I listen to what mine says....

Brenda Groelz
Phillips, Nebraska

 
 
 

Tax Time - HELP!

Post by Ch59 » Sun, 14 Apr 1996 04:00:00


The IRS Ruling is Lower of Cost or Market.  In this case you are only
allowed to deduct the price of the materials. Sorry folks...
 
 
 

Tax Time - HELP!

Post by PJGALLO9 » Thu, 18 Apr 1996 04:00:00


Publication 17 "Your Federal Income Tax" from the IRS says "fair market
value"  which they go on to define as what you would receive in an arms
length transaction between a buyer and seller both trying to get the best
deal.  There are also many record keeping requirements and even more
requirements if over $250 and even more if over $500.

However there is a reduction for any ordinary income you would have
potentially received as if you had sold the property.  This would have
been taxable.  So in effect this reduces it to your basis or cost.

A good policy may be to deduct what you want and plead insanity if you're
audited.  The tax law is enough to drive anyone insane and I have to teach
this stuff.

Paula Galloway